This question is testing PARALLELISM.
We have a list structure, so we need to make sure all of the elements in our list are parallel. Whenever we have a list with infinitives, we have two options:
1) Use the "to" every time: I like to dance, to sing, and to paint
2) Use the "to" only for the first list element. It is implied that it will apply to all other list elements: I like to dance, sing, and paint.
We are NOT allowed to drop the "to" for the 2nd element, then bring it back for the third:
I like to dance, sing, and to paint.
In this sentence, our list is:
Section 301 of the 1988 Omnibus Trade and Competitiveness Act enables the United States Trade Representative to:
a) single out a country as an unfair trader,
b) begin trade negotiation with that country, and, (if the negotiations do not conclude by the United States government’s being satisfied,)
c) to impose sanctions.
The third list item does not match. We cannot use the "to" again, since we didn't use it with "begin."
A. by the United States government’s being satisfied, to impose
We can't use "to." Incorrect.
B. by the United States government’s satisfaction, impose
Correct continuation of "to single..., begin..., and impose," but wrong idiom usage. We can't say "by one's satisfaction." We say "to one's satisfaction."
C. with the United States government’s being satisfied, imposing
Not parallel
D. to the United States government’s satisfaction, impose
Correct parallelism, correct idiom.
E. to the United States government’s satisfaction, imposing
Not parallel
Section 301 of the 1988 Omnibus Trade and Competitiveness Act enables the United States Trade
Representative to single ( I element of list)out a country as an unfair trader, begin( II element) trade negotiations with that
country, and, if the negotiations do not conclude by the United States government’s being satisfied,
to impose (III element, which is not parallel with the earlier two) sanctions.
So we need “IMPOSE” to make list parallel
This leaves us with B and D.
Now when we add preposition “by” after “conclude”, it suggests that the action of conclusion is performed by someone. It turns the structure to passive form. Moreover, the correct passive form is “is/was/are/were concluded”. Hence, “conclude by the US government’s satisfaction” is ungrammatical.
The correct idiom is “conclude to the US government’s satisfaction”.
B- “conclude by” is wrong usage. “concluded to” is better.